WASHINGTON, D.C.—The U.S. Commodity Futures Trading Commission (CFTC) announced
today that it filed a complaint in the U.S. District Court for the Central District of
California charging that Jade Trader and its director and owner, James J.
Zhou, both of Alhambra, California, fraudulently induced clients to purchase
commodity futures contracts.

The CFTC complaint, filed on October 1, 2004, alleges that since October 11, 2002,
Jade Trader and Zhou fraudulently solicited customers to trade approximately $200,000
in commodity futures contracts through accounts that the defendants managed. Jade
Trader posted trading results on its website that falsely represented that its
customers were making money when, in fact, customers were losing money, according to
the complaint. The complaint also alleges that the defendants made false
representations to customers regarding how their accounts would be traded and the risk
involved with trading commodity futures contracts.

The complaint further alleges that the defendants should have been registered with the
CFTC and that Jade Trader failed to provide disclosure documents to customers as
required by CFTC regulations.

The CFTC complaint seeks an order of permanent injunction prohibiting defendants from
violating the commodity laws, operating their fraudulent website, and trading
commodity futures contracts. The complaint further seeks a return of funds to
defrauded customers, disgorgement of the defendants’ ill-gotten gains, and civil
monetary penalties.

The following CFTC Division of Enforcement staff members are responsible for this
case: Elizabeth Padgett, Lacey Dingman, and Jan Folena.